What Are the Expectations for ONEOK's Q4 2025 Earnings

Key Takeaways

• ONEOK (OKE) is poised to report Q4 2025 earnings on February 23, 2026, with analysts forecasting a revenue surge but a slight EPS decline, driven by mixed segment performance.
• Despite a recent 4% dividend increase and strategic acquisitions, valuation concerns and a "Sell" rating from Zacks suggest a cautious outlook.
• The company's fee-based model provides stability, but challenges in the Natural Gas Liquids (NGL) segment and rising interest expenses could temper enthusiasm.

What Are the Expectations for ONEOK's Q4 2025 Earnings?

ONEOK Inc. (OKE) is set to release its fourth-quarter 2025 financial results after the market closes on Monday, February 23, 2026, with an earnings call scheduled for February 24 at 11:00 AM ET. This report comes at a pivotal time for the midstream giant, as investors weigh a robust revenue outlook against a projected dip in earnings per share. The consensus among analysts points to a significant top-line expansion, but the bottom line faces some headwinds.

Wall Street analysts are forecasting Q4 2025 earnings of approximately $1.48 to $1.50 per share. This range, while solid, represents a year-over-year decrease of 4.5% to 5.1% compared to the prior year's quarter. Revenue, however, is expected to tell a different story, with projections ranging from $8.77 billion to $9.49 billion, indicating a substantial year-over-year increase of around 35.6%. This divergence between revenue growth and EPS decline highlights the complex operational dynamics at play within ONEOK's diverse asset portfolio.

The company has a history of meeting or exceeding earnings expectations, having delivered an earnings surprise of 2.05% in the last reported quarter (Q3 2025), with an EPS of $1.49 against an estimate of $1.45. This track record could offer some comfort to investors, but recent estimate revisions suggest a more cautious sentiment. The consensus EPS estimate for Q4 has seen a downward revision of 2.6% over the past 30 days, signaling that analysts have become slightly more bearish on the company's near-term earnings prospects.

Key factors expected to influence ONEOK's Q4 performance include rising industrial demand from sectors like data centers and LNG facilities, which should bolster natural gas volumes. The company's strong reliance on fee-based contracts, which account for over 90% of its revenues, is also anticipated to provide a stable earnings foundation. However, these positive drivers are likely to be partially offset by higher interest expenses, which could trim some of the gains in the quarter.

How Do Analyst Projections Break Down by Segment?

Delving deeper into ONEOK's Q4 2025 outlook reveals a nuanced picture across its various operational segments, with some areas showing robust growth while others face significant contraction. Understanding these individual components is crucial for investors to grasp the underlying drivers of the company's overall performance. This granular view helps explain the anticipated revenue surge alongside the projected dip in earnings.

Analysts project that Revenues from Refined Products & Crude will be a standout performer, expected to reach $2.29 billion, marking an impressive year-over-year increase of 39.4%. This segment's strength underscores ONEOK's strategic shift and increased exposure to demand-pull assets, leveraging its expanded connectivity. Similarly, Natural Gas Pipelines revenue is forecasted to grow by 17.5% to $355.94 million, reflecting steady throughput gains and the benefits of recent infrastructure investments.

However, the Natural Gas Gathering and Processing segment is expected to see a decline, with revenues projected at $1.46 billion, a 20.1% decrease from the year-ago quarter. The most significant headwind appears to be in the Natural Gas Liquids (NGL) segment, where revenues are forecast to contract sharply by 45.3% to $2.47 billion. This substantial decline in NGL revenue highlights structural challenges and sector-specific headwinds, which could be a primary drag on overall profitability despite strong performance elsewhere.

In terms of volumes, analysts anticipate Raw feed throughput to reach 1,650.68 thousand barrels of natural gas liquid per day, suggesting a healthy 26.4% year-over-year growth. This indicates that while NGL revenue might be down, the volume of NGLs moving through ONEOK's system is increasing, possibly due to lower commodity prices or a shift in product mix impacting pricing. Conversely, Natural gas processing volumes are pegged at 5,825.78 million cubic feet of gas per day, implying a slight 0.4% dip from the prior quarter, suggesting a relatively stable but not significantly growing processing environment.

What Do Recent Operational Moves and Market Trends Suggest?

ONEOK has been actively shaping its operational landscape and capital structure, moves that will undoubtedly influence its future performance and investor perception. These strategic decisions, coupled with broader market trends in the energy sector, provide a more complete picture of the company's trajectory beyond just the upcoming earnings report. The company's proactive stance on governance and capital returns signals confidence, even amidst a volatile commodity environment.

A notable development occurred on January 21, 2026, when ONEOK increased its quarterly dividend by 4% to $1.07 per share, translating to an annualized dividend of $4.28. This dividend, paid on February 13, 2026, offers a yield of approximately 5.52% based on the current stock price of $87.33, with a payout ratio near 75.3%. This consistent increase in dividends reinforces management's commitment to returning capital to shareholders and underscores the stability of its fee-based cash flows, even as volume growth moderates.

In addition to capital returns, ONEOK has also focused on governance and strategic asset integration. On January 26, 2026, the company announced additions to its Board of Directors, electing Mark A. as a new independent director. This governance reset, including placements on the Audit and Compensation committees, aims to sharpen oversight as ONEOK integrates recent acquisitions and targets steadier cash flows. These moves are critical as the company digests significant deals from previous quarters, such as increasing its stake in BridgeTex Pipeline Company, LLC to 60% and acquiring the remaining interest in Delaware G&P LLC, which were expected to yield substantial cost savings and synergies.

The broader natural gas market also plays a role. While the price of natural gas (NGUSD) has seen some volatility, currently trading at $3.05, its 52-week range of $2.62 to $7.83 highlights the inherent commodity exposure, albeit mitigated by ONEOK's fee-based model. The ramp-up in well completions in the Rocky Mountain and Mid-Continent regions during previous quarters has contributed to stronger earnings and boosted natural gas gathering and processing volumes. This regional activity, combined with ONEOK's expanded connectivity, aligns with CEO Pierce Norton's strategy to "touch as many molecules as we can for basically as many times as we can for as long as we can," emphasizing demand-pull assets and widened refined-products exposure.

Is OKE's Valuation Reflecting Its Growth Story and Risks?

ONEOK's current valuation metrics present a mixed bag, reflecting both its stable midstream business model and the inherent risks associated with commodity exposure and integration efforts. Investors need to scrutinize these figures to determine if the market is adequately pricing in the company's growth prospects, dividend appeal, and potential headwinds. The stock, currently trading at $87.33, has seen a 15.6% rally over the past month, outpacing the S&P 500's performance, yet analyst sentiment remains cautious.

From a valuation perspective, ONEOK trades at a P/E ratio of 16.40, which is slightly above its 1-year historical P/E of 13.7x but below its 5-year average of 15.1x and 10-year average of 18.4x. This suggests that while the market has recently re-rated the stock higher, it still values it below its longer-term historical averages, possibly due to increased balance sheet complexity from acquisitions. The company's EV/EBITDA stands at 11.20, and its Price-to-Sales (P/S) ratio is 1.74, indicating a relatively fair valuation for a midstream operator with substantial assets.

However, some analysts express caution. Zacks, for instance, currently assigns ONEOK a Zacks Rank #4 (Sell), citing a bearish earnings outlook and valuation concerns. This "Sell" rating, combined with a negative Earnings ESP of -1.45%, suggests that the quantitative model does not conclusively predict an earnings beat for OKE this quarter. This contrasts with the stock's recent price momentum, raising questions about the sustainability of its rally if earnings disappoint.

A valuation model from TIKR, using assumptions of 16.5% revenue growth, 17.7% operating margins, and a 13.7x exit P/E multiple, projects a target price of $100.37 by 2027. This implies an 18.2% total upside from the current price and a 9.3% annualized return over approximately two years. While this suggests potential upside, the model signals a "conservative Sell" because a 9.3% annualized return falls short of typical 10% equity hurdle rates, offering limited capital appreciation relative to the embedded risks of commodity exposure, integration execution, and volume variability.

The company's leverage metrics also warrant attention, with a Debt-to-Equity (D/E) ratio of 1.53 and Net Debt/EBITDA at 4.16. While these are common for capital-intensive midstream companies, maintaining stable leverage trends is crucial for investor confidence, especially as the company navigates large integration phases. Any margin slippage or lower volume guidance could reduce confidence in terminal earnings power and further constrain valuation expansion.

What Are the Bull and Bear Cases for OKE Investors?

For investors considering ONEOK, the upcoming earnings report and the broader market context present both compelling opportunities and significant risks. A balanced perspective is essential, weighing the company's strategic strengths against the challenges it faces in a dynamic energy landscape. The narrative around OKE is complex, blending stable income generation with growth ambitions and commodity price sensitivity.

The bull case for ONEOK centers on its robust fee-based business model, which generates over 90% of its revenues from stable contracts. This provides a strong foundation, insulating the company somewhat from the direct volatility of commodity prices. The recent 4% dividend increase to $1.07 per share, yielding 5.52%, underscores management's commitment to shareholder returns and signals confidence in future cash flows. Strategic acquisitions, like increasing stakes in BridgeTex Pipeline and acquiring Delaware G&P, are expected to drive significant cost savings and synergies, boosting long-term profitability and expanding ONEOK's footprint in key production basins like the Rocky Mountain and Mid-Continent regions. Furthermore, the strong projected 35.6% year-over-year revenue growth for Q4, driven by refined products and crude operations, suggests that ONEOK is effectively leveraging its expanded connectivity and demand-pull assets.

However, the bear case highlights several critical concerns. Despite the strong revenue growth, analysts are forecasting a 4.5% to 5.1% year-over-year decline in Q4 EPS, indicating pressure on the bottom line. The most significant drag is the projected 45.3% contraction in Natural Gas Liquids (NGL) segment revenue, which points to structural challenges within this key business area. Higher interest expenses are also expected to trim gains, impacting overall profitability. The Zacks Rank #4 (Sell) and a negative Earnings ESP of -1.45% suggest that quantitative models do not favor an earnings beat, signaling potential underperformance in the near term. Moreover, while the stock has rallied 15.6% over the past month, its current valuation at a P/E of 16.40 is seen by some as a "conservative Sell" when considering the annualized return against typical equity hurdle rates and the inherent risks of commodity exposure and integration execution.

Ultimately, ONEOK's ability to effectively integrate its acquisitions, manage its debt, and navigate the fluctuating dynamics of the natural gas and NGL markets will dictate its long-term success. Investors should pay close attention to management's guidance on future capital allocation, operational efficiency, and segment-specific performance during the upcoming earnings call.

ONEOK's Q4 2025 earnings report will be a critical juncture, offering clarity on whether its strategic initiatives can overcome segment-specific headwinds and rising costs. Investors should closely monitor the earnings call for insights into future guidance, particularly regarding NGL segment performance and the impact of recent acquisitions. The company's ability to maintain its attractive dividend while navigating these challenges will be key to its appeal in the coming quarters.

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